Barack Obama, Wall Street Warrior?

It was good to hear President Obama say that reining in Wall Street's high-risk behavior is an

"unfinished piece of business."

It would be even better if this observation�were quickly�followed by action - the kind of concrete action�he can take immediately, with or without Congress's cooperation. The President made his remarks in an�interview�with host Kai Ryssdal on public broadcasting's "Marketplace" program. Ryssdal was surprisingly (and effectively) confrontational at several points, as when he asked the President this question: "The Dow today sits plus or minus 17,000, right? Record highs. Banks' profits are up; the big banks are bigger than they were during the financial crisis; their appetite for risk is growing, as we've seen; and all of this is happening after Dodd-Frank -- the financial reform bill that we were told was going to prevent all these things from happening. It was going to rein in the banking system. "So how do you look at the American people and say, 'You know what? 'Too big to fail' has been taken care of. What happened in 2008 is not going to happen to you again.'" In his response, the�President began by arguing that Dodd Frank's "goal ... was to prevent another catastrophic financial crisis," which seem to be a significant downsizing in ambition for a bill which was originally intended to reform a corrupted and counterproductive banking system. But Obama soon warmed to the topic, giving�an eloquent if circumscribed outline of the flaws in our banking system. He talked about the overgrowth of banking profits as a percentage of the economy, adding that "more and more of the revenue generated on Wall Street is based on arbitrage -- trading bets -- as opposed to investing in companies that actually make something and hire people." He added: "And so, what I've said to my economic team, is that we have to continue to see how can we rebalance the economy sensibly, so that we have a banking system that is doing what it is supposed to be doing to grow the real economy, but not a situation in which we continue to see a lot of these banks take big risks because the profit incentive and the bonus incentive is there for them. That is an unfinished piece of business ..." These are not the kinds of words which President Obama says often. They were conspicuously absent, for example, from his most recent�State of the Union address. It's a message he should have been delivering all along, and one which deserves more attention than it's likely to get from a daytime radio interview given during the summer doldrums,�a�day or two before a holiday weekend. And�for all its eloquence, there were some significant omissions from the President's remarks. Nothing was said, for example, about his own Justice Department's failure to indict bankers who bet�illegally, �defrauding customers and investors in the run-up to the 2008 financial crisis. The President's stated goal of deterrence, along with basic principles of justice, called for prosecutions. Instead this president and his then-Treasury Secretary publicly proclaimed that�bankers were innocent, against all evidence and without investigation. That failure to prosecute was especially conspicuous when the President said this: "Some of the work to get that done, though, involves restructuring the banks themselves -- how they work internally. Right now, if you are in one of the big banks, the profit center is the trading desk, and you can generate a huge amount of bonuses by making some big bets; you will be rewarded on the upside. If you make a really bad bet, a lot of times you've already banked all your bonuses." That's absolutely right, and it's to the President's credit that he says so. It's�especially�true when the bonuses in question were earned by engaging in illegal behavior. But President Obama has a great deal more power to change the situation than one might be inclined to believe from this brief interview. He can challenge Mary Jo White, his appointee to run the SEC, for her attempts to eviscerate some of Dodd Frank's reforms. (David Dayen�has further details.) He can direct his Justice Department to crack down on�ongoing abuses�of the fraud-enabling�MERS mortgage database. The President can also invite William Dudley, President of the New York Federal Reserve, over to the Oval Office to explain why�he has said�that "There is evidence of deep-seated cultural and�ethical failures at many large financial institutions," and that Wall Street banks display an "apparent lack of respect for law, regulation and the public trust," along with "deep-seated cultural and ethical failures." Better yet, President Obama can appoint Mr. Dudley to a special commission charged with rooting out Wall Street abuses, pressuring regulators to implement current law, and make recommendations for additional legislation. The President should immediately direct his Treasury Department to spend the rest of the money allocated for helping distressed homeowners, revamping the often-shameful legacy of his HAMP program. He�can also heed Elizabeth Warren and stop appointing members of the "Citigroup clique" to his Administration. (This bank, created with the assistance of the Clinton Treasury Department, has been a primary source of revolving-door appointments under both the Clinton and Obama administrations.) Danielle Douglas�outlines other steps the President can take in the Washington�Post, including modifications to banker pay and incentives and additional limits to bank risk-taking. Longer-term, the President can look to Europe (and Switzerland in particular) for�solutions to the perverse pay incentives�which lead bank executives astray. Then there's the mega-bank problem. As�Jennifer Taub�notes, the preamble to the Dodd Frank bill specifically mentions the profound economic threat of "too big to fail" banks. Much more needs to be done to address this critical problem, including a reinstatement of Glass-Steagall and a wind-down of banks which pose systemic threats. Why has the President raised this subject now? That's a matter for speculation. One hopes he's preparing to take action, or at a minimum to offer some specific proposals. If not, he's presumably concerned about his legacy should things go wrong somewhere down the road. That's a very legitimate concern. With bank risk-taking once again on the rise, a hyperinflated stock market, and a renewed tendency toward fraudulent (or at best, fraud-like) banker behavior, there's no reason to be sanguine. Even if we don't experience another crisis - and we could - the ongoing financialization of the economy will continue to strangle healthier forms of economic growth, at least until something is done about it. Let's hope the President is doing more than simply stating�his�awareness�of these problems for posterity. If he genuinely wants to�shine a light on some much-needed solutions,�he should employ�the old movie-business maxim: Show, don't tell.

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As President Obama gets set to leave office, take a look back at one of his most memorable moments when he didn\'t hold back in his final speech at the White House correspondents\' dinner firing barbs at himself, Donald Trump, Justin Trudeau, Hillary Clinton, Bernie Sanders and Ted Cruz.
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» Subscribe to MSNBC: http://on.msnbc.com/SubscribeTomsnbc
About: MSNBC is the premier destination for in-depth analysis of daily headlines, insightful political commentary and informed perspectives. Reaching more than 95 million households worldwide, MSNBC offers a full schedule of live news coverage, political opinions and award-winning documentary programming -- 24 hours a day, 7 days a week.
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One of the biggest failures of both the Obama Presidenc